Perchlorate is known to suppress thyroid function by inhibiting uptake of iodide by the human thyroid at doses of 200 mg/day or greater. A study was conducted to investigate the potential effects of perchlorate in drinking water on thyroid function in newborns and school-age children. A total of 162 school-age children and 9784 newborns were studied in three proximate cities in northern Chile that have different concentrations of perchlorate in drinking water: Taltal (100 to 120 micrograms/L), Chañaral (5 to 7 micrograms/L), and Antofagasta (non-detectable: < 4 micrograms/L). Among schoolchildren, no difference was found in thyroid-stimulating hormone levels or goiter prevalence among lifelong residents of Taltal or Chañaral compared with those of Antofagasta, after adjusting for age, sex, and urinary iodine. No presumptive cases of congenital hypothyroidism were detected in Taltal or Chañaral; seven cases were detected in Antofagasta. Neonatal thyroid-stimulating hormone levels were significantly lower in Taltal compared with Antofagasta; this is opposite to the known pharmacological effect of perchlorate, and the magnitude of difference did not seem to be clinically significant. These findings do not support the hypothesis that perchlorate in drinking water at concentrations as high as 100 to 120 micrograms/L suppresses thyroid function in newborns or school-age children.